Marketing budgets are usually tight. To maximize profitability, every dollar must be allocated effectively. Here are five strategies that can be implemented instantly to get the most out of marketing budgets.
1. Focus on what works best.
Set up goals in Google Analytics to effectively measure the source and quantity of leads or sales. By comparing sources such as paid campaigns, organic traffic and social media channels, you can apply the Pareto Principle, also known as the 80/20 rule.
You are going to find out what sources generate the majority of sales to later tune up your budget allocation. Use the Pareto Principle and identify the top 20 percent of your traffic sources that generate 80 percent of good results. Focus your budget on that. Especially for smaller budgets, it is often times more effective to allocate it on the 10 percent that is generating 90 percent of results.
2. Stay in control of budget and targeting.
Not all marketing solutions allow for full control of how much is spent and who is targeted. Instead of spreading your budget thin on a large variety of platforms, focus on the ones where you are in full control of both targeting and cost. Examples are the online advertising giants, Google, Bing and Facebook.
The more control you have on what you can spend your budget on, the more you will be able to get rid of what does not work and focus your limited resources on.
3. Don’t scale until it’s profitable.
Any marketing campaign, online or offline, should be started on a small scale with narrow targeting. Once it is profitable, the campaign can be scaled. Scaling can mean experimenting with different campaign types on the same platform as well as adding other platforms.
The reasoning behind starting small and waiting for the ROI to come in is two-fold: First of all, the profit from the initial campaign creates a buffer for potentially unprofitable additional campaigns or platforms. Secondly, business owners know now exactly what works well. They can base other marketing efforts on that, or simply put more budget into the initial campaign, without significantly increasing the risk of missing out on a return.
You should also consider the importance of having a statistical relevance in results before deciding on whether to scale up your investment or not. Always support your decision with enough data insights.